Tegemeo at MTEF Budget Public hearing

 Tegemeo at MTEF  Budget Public hearing

 

Dr. Timothy Njagi, Research Fellow, Presenting at the MTEF Public Hearings

The government may need to review its budgetary allocation to the Agriculture and Urban Development (ARUD) Sector if the intended gains are to be realized.

According to Tegemeo Institute of Agricultural Policy and Development of Egerton University, the current budgetary allocations are way below the government’s commitment to allocate 10% of the National Budget to ARUD and 2% of Agriculture GDP to Research and Development. Current allocation to the sector was 2.3 % in 2013/14 while the allocation to Research and Development (R&D) was 0.62% of Agriculture GDP.

Dr. Timothy Njagi who represented the Institute at the Medium Term Expenditure Framework (MTEF) Budget Public Hearings as a discussant, noted that although there has been an increase in funds allocated to ARUD the share of allocation has been declining a decade since Maputo Declaration (2003). He added that the allocations to the sector for 2014/15 are below the requirements (only 38% of the total requirement has been provided for) although the allocation increase by 4% in comparison to 2012/1013 financial year. The recurrent expenditure is also expected to decline for the period 2014/15 to 2016/17 while the development expenditure is expected to increase.

He further noted that the Indicators must show progress towards achieving targets set in the Second medium Term Plan to as feedback to the sector’s performance. There is also need to allocate more resources for Monitoring Learning and Evaluation (ML&E). Other concerns included the absorption capacity for development expenditure which was low, possibly contributing to an increase in Pending bills which increased two fold in 2012/13.

The public hearings are part of the MTEF budget process by the government which aims to create a link between planning and budgeting by linking policy making with planning, budgeting and implementation of programs and projects. The event also facilitates expenditure prioritization and maintains fiscal discipline by establishing solid budget targets.

This is a crucial exercise since the Agriculture and Rural and Urban Development (ARUD) sector is earmarked as one of the six sectors to deliver the 10% economic growth rate (Vision 2030). The sector contributes 24% to the national GDP, 60% to export earnings, 18% to formal employment and 60% to informal employment. It also contributes to food and nutrition security, provides forward and backward linkages with other sectors for instance manufacturing, where it contributes 75% of industrial raw materials, land, food security, investments and growth.

The event was held at the KICC on the 16th of January 2014.